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It's beginning to look a lot like Christmas won't be a total disaster for retailers after all. Just as unemployment numbers appear to be turning, and the economy is showing a pulse, holiday sales forecasts are turning more positive than even a month ago.

The International Council of Shopping Centers just went out on a limb and forecast that this year's holiday sales will be higher than last year's. Only a week ago, forecasts were calling for a flat holiday, and in August, shoppers were looking like Scrooge.
In a report by Chief Economist Michael P. Niemira, the ICSC is projecting holiday sales will be up one to two percent above last year's numbers. "That is not strong, but it is likely to be much better than in 2008, and signal better times ahead for 2010," Niemira's report states.

This will be the stores' first non-recession holiday in three years, according to the ICSC's report. Economic growth is starting to turn around, even with some pockets of weakness, and consumer confidence is slowly improving, which will give way to some increased gift buying.

But don't worry about the shelves going bare. Despite the retailers' efforts to cut back on inventory, shortages won't depress sales. Niemira's report looked back to the last recession, in 2001, to note that holiday sales picked up around three percent, even through retailers had cut back inventory then, too.

Niemira also warned not to get too excited by the positive numbers, because they're compared to a lousy season in 2008, when retailers saw sales drop in the three to five percent range, depending on the store type.

So the comparison to last year pads this year's forecast by anywhere from two to five percentage points. Looking at the underlying sales numbers, this holiday is going to look more like 2005 -- before the peak of the housing bubble that had turned American homes into ATMs.